Exhibit 2.A

                        ===============================



                             TRANSACTION AGREEMENT


                                    between


                       CENEX HARVEST STATES COOPERATIVES,
                      a Minnesota cooperative association

                                      and

                           FARMLAND INDUSTRIES, INC.,
                        a Kansas cooperative corporation




                         Dated as of September 23, 1999


                        ===============================


                               TABLE OF CONTENTS




ARTICLE ITHE TRANSACTION........................................1
     Section 1.01.........................Overview of Transaction     1
     Section 1.02.....................................The Closing     2
     Section 1.03..........................Actions at the Closing     2
     Section 1.04...........................Effect of Transaction     3

ARTICLE IIREPRESENTATIONS AND WARRANTIES OF CHSC................5
     Section 2.01..................Organization and Good Standing     6
     Section 2.02............................Financial Statements     6
     Section 2.03..........................Absence of Liabilities     6
     Section 2.04...............................Title to Property     6
     Section 2.05...........................Intellectual Property     7
     Section 2.06......................Compliance with Laws, etc.     7
     Section 2.07Pending Litigation, Claims, Actions, Proceedings or
          Investigations........................................7
     Section 2.08.............................Absence of Defaults     7
     Section 2.09...................................Authorization     8
     Section 2.10.......................................Insurance     8
     Section 2.11......................Governmental Authorization     8
     Section 2.12....................................Subsidiaries     8
     Section 2.13.....................................SEC Filings     9
     Section 2.14......................Absence of Certain Changes     9
     Section 2.15...........................................Taxes     9
     Section 2.16..........................Employee Benefit Plans     10
     Section 2.17...........................Environmental Matters     11
     Section 2.18..........................Pooling; Tax Treatment     12
     Section 2.19...........................No Dissenters' Rights     12
     Section 2.20.................................Acquisition Co.     12
     Section 2.21.................................Full Disclosure     13

ARTICLE IIIREPRESENTATIONS AND WARRANTIES OF FARMLAND..........13
     Section 3.01..................Organization and Good Standing     13
     Section 3.02............................Financial Statements     14
     Section 3.03..........................Absence of Liabilities     14
     Section 3.04...............................Title to Property     14
     Section 3.05...........................Intellectual Property     14
     Section 3.06......................Compliance with Laws, etc.     15
     Section 3.07Pending Litigation, Claims, Actions, Proceedings or
          Investigations.......................................15
     Section 3.08.............................Absence of Defaults     15
     Section 3.09...................................Authorization     15
     Section 3.10.......................................Insurance     16
     Section 3.11......................Governmental Authorization     16
     Section 3.12....................................Subsidiaries     16
     Section 3.13.....................................SEC Filings     16
     Section 3.14......................Absence of Certain Changes     17
     Section 3.15...........................................Taxes     17
     Section 3.16..........................Employee Benefit Plans     18
     Section 3.17...........................Environmental Matters     19
     Section 3.18..........................Pooling; Tax Treatment     19
     Section 3.19...........................No Dissenters' Rights     19
     Section 3.20.................................Full Disclosure     20

ARTICLE IVPRE-CLOSING COVENANTS................................20
     Section 4.01..........................Selection of Structure     20
     Section 4.02..............................Good Faith Efforts     20
     Section 4.03........................Preservation of Business     21
     Section 4.04............................Conduct of Business.     21
     Section 4.05.............................Meetings of Members     22
     Section 4.06.....................................Full Access     22
     Section 4.07..........................Notice of Developments     23
     Section 4.08.......................................Exclusive     23
     Section 4.09.......................Hart-Scott-Rodino Filings     23
     Section 4.10....................Tax and Accounting Treatment     23

ARTICLE VCLOSING CONDITIONS....................................23
     Section 5.01.........Conditions to Obligations of Each Party     24
     Section 5.02.....Additional Conditions to Obligation of CHSC     24
     Section 5.03.Additional Conditions to Obligation of Farmland     25

ARTICLE VIPOST-CLOSING AGREEMENTS..............................26
     Section 6.01..................Consolidation of Benefit Plans     26
     Section 6.02.........................Patronage Distributions     26
     Section 6.03...Indemnification of Former Officers; Insurance     26

ARTICLE VIITERMINATION.........................................27
     Section 7.01........................Termination of Agreement     27
     Section 7.02...........................Effect of Termination     27

ARTICLE VIIIMISCELLANEOUS......................................28
     Section 8.01............................Waiver of Conditions     28
     Section 8.02.......................................Amendment     28
     Section 8.03..................................Binding Nature     28
     Section 8.04....................................Counterparts     28
     Section 8.05................................Entire Agreement     28
     Section 8.06.........................................Notices     28
     Section 8.07..Non-Survival of Representations and Warranties     29
     Section 8.08........................................Captions     29


Exhibits


Exhibit A-1    -                   Structure A Plan of Merger
Exhibit A-2    -                   Structure A Surviving Entity Bylaws
Exhibit B-1    -                   Structure B Plans of Merger
Exhibit B-2    -                   Structure B Surviving Entity Bylaws
Exhibit C -    Senior Management Reporting Relationships
Exhibit D -    Capital Plan

CHSC Disclosure Schedule
Farmland Disclosure Schedule
                             TRANSACTION AGREEMENT

     THIS TRANSACTION AGREEMENT (this "Agreement") is  made and entered into  as
of September  23, 1999,  by and  between CENEX  HARVEST STATES  COOPERATIVES,  a
Minnesota cooperative  association ("CHSC"),  and FARMLAND  INDUSTRIES, INC.,  a
Kansas cooperative corporation ("Farmland").

     WHEREAS, each of CHSC and Farmland is an agricultural cooperative organized
for the purposes of benefitting and serving its members and patrons; and

     WHEREAS, the  parties  believe that  the  unification of  their  respective
business operations and assets will be in the best interest of their  respective
members; and

     WHEREAS, on May 6,  1999, the parties entered  into a Memorandum of  Intent
pursuant to  which both  parties agreed  to  negotiate in  good faith  to  reach
agreement on the principal terms of  a transaction pursuant to which they  would
combine their respective assets  and business operations  into a single  entity,
through a form of business combination to be determined by the parties, and

     WHEREAS, the parties have now reached  agreement as to the final terms  and
conditions of such business  combination, and wish to  reduce such agreement  to
writing as more particularly described herein.

     NOW  THEREFORE,  in   consideration  of  the   foregoing  and  the   mutual
representations, warranties and covenants  herein contained, the parties  hereto
agree as follows:

                                   ARTICLE I

  THE TRANSACTIONARTICLE ITHE TRANSACTION{tc  \l 1 "ARTICLE ITHE TRANSACTION"}


     Section 1.01                  Overview of TransactionSection 1.01

          Overview of Transaction{tc  \l 2 "Section 1.01      Overview       of

     Transaction"}.
     At the Effective  Time (as such  term is defined  in section 1.04  hereof),
CHSC and  Farmland will  combine  into a  single  entity named  "United  Country
Brands, Inc." (the "Surviving Entity").  The combination will be in the form  of
either (a) Structure A, which will be a  merger of Farmland with and into  CHSC,
with CHSC  as the  Surviving Entity,  such  merger to  become effective  at  the
Effective Time ("Structure A"), or (b) a merger, prior to the Effective Time, of
CHSC into UCB Acquisition Co., an Ohio cooperative corporation and  wholly-owned
subsidiary of CHSC ("Acquisition Co."), with Acquisition Co. as the survivor  in
such merger (the "CHSC/Acquisition Co. Merger"), and immediately thereafter, the
merger of Farmland into Acquisition Co.,  with Acquisition Co. as the  Surviving
Entity ("Structure  B").   The parties  anticipate and  agree that  Structure  A
constitutes the  structure that  is preferred  by the  parties and  the  default
structure to accomplish  the combination, and  agree that Structure  A shall  be
used (and that the  parties will use  their best efforts  to resolve any  issues
relating to the use  of Structure A)  unless, prior to  the Closing (as  defined
herein), either party obtains an  opinion of counsel to  the effect that use  of
such Structure A would have a Material Adverse Effect (as defined herein) on the
Surviving Entity.  If  Structure A is used  to accomplish the combination,  then
(i) the parties shall execute, deliver and file the Agreement and Plan of Merger
attached hereto as Exhibit  A-1 to effectuate  the merger therein  contemplated;

and (ii)  effective as  of the  Effective  Time, the  Surviving Entity  will  be
governed by Articles of Incorporation in the form attached hereto as Schedule  I

to such Plan of Merger and  Bylaws in the form  attached hereto as Exhibit  A-2

and will otherwise continue  to operate and exist  as a cooperative  association
organized under the laws of the State of Minnesota.   If Structure B is used  to
accomplish the  combination, then  (i) CHSC  shall  take appropriate  action  to
effectuate the CHSC/Acquisition Co. Merger,  and in connection therewith,  shall
execute, deliver and file the appropriate Agreement and Plan of Merger  attached
hereto  as  Exhibit  B-1  and  shall  redeem  all  of  its  outstanding   Equity

Participation Units in the Defined Business  Units; (ii) thereafter the  parties
shall execute, deliver  and file the  appropriate Agreement and  Plan of  Merger
attached hereto as Exhibit B-1  as required by law  to effectuate the merger  of

Farmland into Acquisition Co.; and (iii) effective as of the Effective Time, the
Surviving Entity  will be  governed by  Articles of  Incorporation in  the  form
attached hereto as  Schedule I to  such Plan of  Merger and Bylaws  in the  form

attached hereto  as Exhibit  B-2  and will  (subject  to Section  4.01  hereof)

continue to operate and exist as a cooperative association  organized under  the
laws of  the State  of Ohio.   The  Agreement and  Plan of  Merger so  used  and
executed, delivered and filed as hereinabove  provided is referred to herein  as
the "Plan of Merger", the Articles of Incorporation which serve as the  Articles
of Incorporation  of  the  Surviving  Entity  are  referred  to  herein  as  the
"Surviving Entity  Articles",  the Bylaws  which  serve  as the  Bylaws  of  the
Surviving Entity are referred  to herein as the  "Surviving Entity Bylaws",  and
the  merger  transaction  therein  contemplated,  together  with  all   actions,
consents, agreements and transactions described herein or otherwise necessary or
desirable in connection therewith,  are referred to  collectively herein as  the
"Transaction."

     Section 1.02                  The Closing

     Unless this Agreement  is terminated and  the Transaction  is abandoned  as
provided in Article VII hereof, the closing for the Transaction (the  "Closing")
shall take place  on or  before February 29,  2000, or  such other  date as  the
parties may mutually determine (the "Closing Date"), subject to the satisfaction
or waiver  of all  conditions to  the  obligations of  each  of the  parties  to
consummate the Transaction (other than conditions with respect to actions  which
the respective parties will take at the Closing itself).


     Section 1.03                  Actions at the Closing

     At the Closing, the parties shall (a) execute and deliver the Agreement and
Plan of  Merger  pursuant  to  Section  1.01  above,  (b)  deliver  the  various
certificates, instruments and documents referred to in the Plan of Merger or  in
Article V of this  Agreement, and (c) cause  to be filed  with the Secretary  of
State of the  appropriate states the  Plan of Merger,  certificate of merger  or
such other documents as may be required by the applicable laws to effectuate the
Transaction pursuant to the terms of the Plan of Merger and this Agreement.


     Section 1.04                  Effect of Transaction

     The Transaction shall become fully effective at 12:02 a.m. Central Time  on
March 1, 2000 (the "Effective Time").  The Transaction shall have the effect set
forth in the Plan of Merger,  this Agreement and applicable  state law.  At  any
time after  the  Effective  Time,  the Surviving  Entity  may  take  any  action
(including executing and delivering any document)  in the name and on behalf  of
either party  to  this  Agreement in  order  to  carry out  and  effectuate  the
Transaction contemplated by this Agreement.  At the Effective Time, without  any
further action on the part of the members  or the boards of directors of  either
CHSC or Farmland:

          (a)  Articles and  Bylaws.   The  Surviving  Entity Articles  and  the

     Surviving Entity  Bylaws shall  become the  articles of  incorporation  and
     bylaws of the Surviving Entity, as provided in the Plan of Merger.

          (b)  Board of Directors.


               (i)   Transition Board   Each of the  then current directors  of
          Farmland and the then current directors of CHSC will become  directors
          of the Surviving Entity,  to serve according  to the Surviving  Entity
          Bylaws, so that the board of  directors of the Surviving Entity as  of
          the Effective Time will consist of  all of the then current  directors
          of both Farmland  and CHSC.   Each party  agrees to  take all  actions
          necessary to reduce, as of the Effective Time, the number of directors
          on the Board of Directors of such party to seventeen (17).

               (ii) Producer Directors After December  2001.  Effective for  and
          after the annual meeting of the members of the Surviving Entity to  be
          held in December 2001, for purposes of Section 4.4(b) of the Surviving
          Entity Bylaws and subject to review  and reapportionment by the  Board
          of Directors of the Surviving Entity pursuant to Section 4.4(c) of the
          Surviving Entity Bylaws  from time to  time, the  numbers of  producer
          directors in each director district shall be as follows: District 1 --
          one (1) producer director; District 2  -- two (2) producer  directors;
          District 3 --  four (4)  producer directors;  District 4  -- five  (5)
          producer directors; District 5 -- two (2) producer directors; District
          6 -- one (1) producer director;  and District 7 -- three (3)  producer
          directors.

          (c)  Board Officers.  For  the period from the  Effective Time to  the
     annual meeting  of  the members  of  the Surviving  Entity  to be  held  in
     December 2000  (the  "Transition  Period"), Elroy  Webster  will  serve  as
     Chairman of the Board and Albert Shivley will serve as the Vice Chairman of
     the Board.  In addition, effective as of the Effective Time, there shall be
     established an Executive Committee of the Board, and the following Standing
     Committees of the Board:  Capital, Finance/Audit, Governance and  Corporate
     Responsibility (including  compensation).   For the  Transition Period  the
     Capital  Committee  will   be  chaired   by  Merlin   Van  Walleghen,   the
     Finance/Audit Committee of the Board will  be chaired by Monte Romohr,  the
     Governance Committee will  be chaired by  Gerald Kuster  and the  Corporate
     Responsibility  Committee  will  be  chaired  by  Jody  Bezner.    For  the
     Transition Period, the Chairman  and Vice Chairman  of the Board,  together
     with the Chairs  of the Standing  Committees, shall make  up the  Executive
     Committee.

          (d)  Office of Leadership.  The "Office of Leadership" will consist of
     the Chief  Executive Officer  and the  President of  the Surviving  Entity.
     Robert Honse  ("Honse")  will  serve as  Chief  Executive  Officer  of  the
     Surviving Entity,  reporting to  the board  of directors  of the  Surviving
     Entity.  It is anticipated that Honse shall serve in that capacity  through
     no later than December 31, 2003; and John D. Johnson ("Johnson") will serve
     as the President of the Surviving Entity, reporting to the Chief  Executive
     Officer of the  Surviving Entity.   Upon expiration of  Honse's service  as
     Chief Executive Officer, it  is anticipated that  Johnson shall assume  the
     role of  President and  Chief Executive  Officer of  the Surviving  Entity.
     Both   the Chief  Executive Officer  and the  President will  serve at  the
     pleasure of the Board  of Directors of the  Surviving Entity at all  times,
     subject, however, to the monetary  provisions of any applicable  employment
     contract.   Such employment  contracts will  provide that  Honse, as  Chief
     Executive Officer, may not demote, discharge, change the senior  management
     reporting relationships (described in paragraph (e) below) of, or otherwise
     materially adversely change the status  of, Johnson, as President,  without
     the agreement of the Executive Committee of the Board of Directors.

          (e)  Senior Management.   Senior management will  be as designated  by
     the Office of Leadership from time to time in accordance with the Surviving
     Entity Bylaws.  The reporting  relationships between senior management  and
     the Office of Leadership  are identified in Exhibit  C attached hereto  and
     will be incorporated  into employment  contracts with  the Chief  Executive
     Officer and the President.

          (f)  Exchange and Conversion of Stock, Non-Stock Equity and  Patronage
     Equities.  At and as of the  Effective Time, without any further action  by
     the parties or any of their respective members, and as further described in
     the Plan of Merger,  (i) each member  of CHSC and  each member of  Farmland
     shall become  a member  of the  Surviving Entity,  to the  extent they  are
     eligible for  membership  under  the  Surviving  Entity  Articles  and  the
     Surviving Entity Bylaws, and (ii) except for any stock and equity interests
     of Farmland in CHSC or any stock interest of CHSC in Farmland (which shall,
     in each case, be extinguished), the  stock, non-stock equity and  patronage
     equity interests of each member, patron and former patron of Farmland shall
     be exchanged for  non-stock equity and  patronage equity  interests in  the
     Surviving Entity at their stated value amount on a dollar-for-dollar basis,
     as further described in the Plan of Merger.

          (g)  Capital Plan.  From and after  the Effective Time, the  Surviving
     Entity will  operate  pursuant  to  a capital  plan  that  adheres  to  the
     principles set forth on Exhibit D attached hereto and the Surviving  Entity
     shall use  its best  efforts to  adopt and  implement a  capital plan  that
     incorporates such principles (the "Capital Plan").  The Capital Plan may be
     adopted and amended from  time to time,  by the board  of directors of  the
     Surviving Entity, provided that amendment of any provisions of the  Capital
     Plan relating to disposition of the Terra tax case shall require a vote
     of
     three-fourths (3/4) of the full board of directors of the Surviving Entity,
     and provided further  that any such  amendment shall, as  far as  feasible,
     adhere to  the  "Key Terra  Principles"  described on  Exhibit  D  attached
     hereto.

                                   ARTICLE II

 REPRESENTATIONS AND WARRANTIES OF CHSC

     CHSC represents and warrants to Farmland and the Surviving Entity that  the
statements contained in this Article II are correct and complete in all material
respects as of  the date  of this Agreement,  except as  set forth  in the  CHSC
Disclosure Schedule delivered  by CHSC to  Farmland attached  hereto (the  "CHSC
Disclosure Schedule").  Nothing in the CHSC Disclosure Schedule shall be  deemed
adequate to disclose an  exception to a representation  or warranty made  herein
unless the CHSC Disclosure Schedule identifies the exception with  particularity
and describes the relevant facts in detail.  Without limiting the generality  of
the foregoing, the mere listing (or inclusion of a copy) of a document or  other
item shall not be deemed adequate  to disclose an exception to a  representation
or warranty made herein  (unless the representation or  warranty has to do  with
the existence of  the document or  other item itself).    For  purposes of  this
Agreement (a) the  word "Subsidiary" when  used with respect  to any Person  (as
herein defined) means any other  Person, whether incorporated or  unincorporated
(i) of  which  fifty  percent or  more  of  the securities  or  other  ownership
interests is directly owned or controlled by such  Person or by any one or  more
of its Subsidiaries, or  (ii) of which securities  or other interests having  by
their terms ordinary voting power to elect fifty percent or more of the board of
directors  or  others  performing  similar   functions  with  respect  to   such
corporation or other organization is directly owned or controlled by such Person
or by any one or more  of its Subsidiaries, or (iii)  when such Person is  CHSC,
the entities listed on the CHSC Disclosure Schedule, or (iv) when such Person is
Farmland, the entities  listed on the  Farmland Disclosure  Schedule (as  herein
defined), (b) "Person" means an individual,  a corporation, a limited  liability
company, a  partnership,  an  association,  a  trust  or  any  other  entity  or
organization, including a government or political  subdivision or any agency  or
instrumentality thereof, and (c) a "Material Adverse Effect" with respect to any
Person means a  material adverse effect  on the  financial condition,  business,
liabilities, properties, assets or results of  operations, taken as a whole,  of
such Person  and  its Subsidiaries,  taken  as a  whole,  except to  the  extent
resulting from  (w) any  changes in  general United  States or  global  economic
conditions, (x) any changes affecting the agricultural industry in general,  (y)
matters whose  significance  or  impact  would  reasonably  be  expected  to  be
primarily short term  (i.e., under  one year) or  (z) matters  disclosed on  the
Person's Disclosure Schedule.


     Section 2.01   Organization and Good Standing

     CHSC is a cooperative association duly organized and existing under Chapter
308A of the Minnesota Statutes, is in good standing under the laws of the  State
of Minnesota, and  has all requisite  corporate power and  authority to own  its
properties and conduct its business as it is presently being conducted.  CHSC is
duly qualified to do business  and is in good  standing in each jurisdiction  in
which it conducts business or owns or leases properties of a nature which  would
require such qualification, except for those jurisdictions where the failure  to
be so qualified  would not, individually  or in the  aggregate, have a  Material
Adverse Effect on  CHSC.   CHSC has heretofore  delivered to  Farmland true  and
complete copies of the CHSC articles of incorporation and bylaws as currently in
effect.


     Section 2.02   Financial StatementsSection 2.02

     CHSC has delivered to Farmland (a)  its audited financial statements as  of
August 31, 1998, accompanied by the  opinion of PricewaterhouseCoopers, (b)  the
audited financial statements  of CENEX, Inc.  for the year  ended September  30,
1997 and  the  eight  months ended  May  31,  1998, (c)  the  audited  financial
statements of Harvest States Cooperatives for  the year ended May 31, 1998,  and
(d) the unaudited financial statements of CHSC for the nine months ended May 31,
1999.  Such financial statements fairly  present the financial position of  CHSC
at the dates indicated therein and the results of its operation for the  periods
indicated therein, in conformity  with generally accepted accounting  principles
consistently applied ("GAAP").  There has been no material adverse change in the
financial condition or results of operations of CHSC since May 31, 1999.


     Section 2.03   Absence of Liabilities

     Neither CHSC nor any Subsidiary of CHSC has any liabilities or obligations,
absolute or contingent,  except for liabilities  and obligations  which are  (i)
reflected in the financial  statements referred to in  Section 2.02, (ii)  fully
covered  by  insurance,  except  for  reasonable  deductibles  or   self-insured
retention levels, (iii) incurred  in the ordinary course  of business since  May
31, 1999 and not materially different in type or amount from those reflected  in
the financial statements referred to in Section  2.02, or (iv) would not in  the
aggregate reasonably be expected to have a Material Adverse Effect on CHSC.


     Section 2.04   Title to Property

     Except as  reflected  in  the  notes  accompanying  the  audited  financial
statements of CHSC,  CHSC has good and marketable title to all real and personal
property reflected as owned on the books and records  of CHSC as of the date  of
this Agreement  and  owns outright  all  other assets,  properties  or  property
interests acquired since that date, in  each case free of all mortgages,  liens,
charges and  encumbrances, other  than (i)  easements, rights-of-way  and  other
encumbrances which do  not materially impair  the use of  such real or  personal
property for the same or similar purposes as such real or personal property  has
been used by CHSC prior to the Effective Time, (ii) liens for current taxes that
are not yet due and payable, (iii) liens related to the acquisition of inventory
or otherwise arising  in the normal  course of business,  and (iv) other  liens,
encumbrances and title defects which would not reasonably be expected to have  a
Material Adverse Effect on CHSC.


     Section 2.05   Intellectual Property

     CHSC owns or possesses,  is licensed under or  otherwise has lawful  access
to, all  patents,  trade  secrets,  know-how,  other  confidential  information,
trademarks, service marks, copyrights, trade names, logos and other intellectual
property, whether registered or unregistered,  necessary for the lawful  conduct
of its business as currently conducted, without any infringement of or  conflict
with the industrial or intellectual property  rights of any third party,  except
as would not reasonably be expected to  have a Material Adverse Effect on  CHSC.
CHSC does not know or have reason to know of any unauthorized use or  disclosure
or misappropriation of any of its intellectual property, which disclosure,  use,
or misappropriation  would reasonably  be expected  to have  a Material  Adverse
Effect on CHSC.


     Section 2.06   Compliance with Laws, etc.

     CHSC is  in  compliance  with  all  applicable  laws  and  regulations  the
violation of  which would  reasonably be  expected to  have a  Material  Adverse
Effect on CHSC.   CHSC has all  governmental authorizations, consents,  licenses
and permits required by law or  otherwise necessary for the proper operation  of
its business as  currently conducted, all  of such licenses  and permits are  in
full force  and  effect and  no  action to  terminate,  withdraw, not  renew  or
materially limit or otherwise  change any such license  or permit is pending  or
has been threatened by any governmental  agency or other party, except as  would
not reasonably be expected to have a Material Adverse Effect on CHSC.


     Section 2.07   Pending  Litigation,   Claims,   Actions,   Proceedings   or

     Investigations

     There is no action, proceeding or investigation pending against, or to  the
best of the knowledge  of CHSC after reasonable  inquiry, is threatened  against
CHSC or any Subsidiary of CHSC or any of the  assets which are owned by CHSC  or
any Subsidiary of  CHSC which would  reasonably be expected  to have a  Material
Adverse Effect on CHSC.


     Section 2.08   Absence of Defaults

     CHSC is not in default under any provision of its Articles of Incorporation
or Bylaws or any indenture, mortgage, loan agreement or other material agreement
to which it is a party or by which it is bound, and CHSC is not in violation  of
any statute,  order, rule  or regulation  of any  court or  governmental  agency
having jurisdiction over it or its properties, which, in each case, could have a
Material Adverse  Effect on  CHSC,   and,  except for  any consent  or  approval
identified on the CHSC Disclosure Schedule,  neither the execution and  delivery
of this Agreement  nor the consummation  of the Transaction  in accordance  with
this Agreement will in any respect conflict with or result in a breach of any of
the foregoing, which could have a Material Adverse Effect on CHSC.


     Section 2.09   Authorization


     CHSC has the corporate power and authority to enter into and to perform its
obligations under this  Agreement (subject  to the  approval of  its members  as
required by Section 5.01(a)).  This Agreement and the Transaction have been duly
and validly authorized by the  Board of Directors of  CHSC, and (except for  the
approvals of its  members, as required  by Section 5.01(a))  no other  corporate
action is required by CHSC in connection with this Agreement or the Transaction.
This Agreement constitutes the valid and binding agreement of CHSC,  enforceable
against CHSC in accordance with its terms, except to the extent such enforcement
may be limited by the application of equitable principles where equitable relief
is sought or bankruptcy and other laws relating to the enforcement of creditors'
rights generally.


     Section 2.10   Insurance

     CHSC has secured  appropriate insurance policies  which (i)  are issued  by
sound and reputable insurance companies duly authorized to write said insurance,
(ii) are in full force and effect, (iii) are sufficient for compliance with  all
requirements of  law and  all agreements  to which  CHSC is  a party,  and  (iv)
provide reasonable insurance coverage for the assets and operations of CHSC  and
all liabilities related thereto.


     Section 2.11   Governmental Authorization


     The execution, delivery and performance by  CHSC of this Agreement and  the
consummation of the Transaction by CHSC require  no action by or in respect  of,
or filing with, any governmental body, agency, official or authority other  than
(a) the  filing of  appropriate documents  to effect  the Plan  of Merger  under
applicable law, (b)  compliance with any  applicable requirements  of the  Hart-
Scott-Rodino Antitrust Improvements Act of 1976 (the "HSR Act"), (c)  compliance
with applicable requirements of U.S. state  and federal securities laws and  (d)
other actions or filings which if not  taken or made would not, individually  or
in the aggregate, have a Material Adverse Effect on CHSC or the Surviving Entity
following the Effective Time.

     Section 2.12   Subsidiaries

     Each Subsidiary of  CHSC is duly  organized, validly existing  and in  good
standing under the laws of its jurisdiction of organization, has all powers  and
all governmental licenses,  authorizations, consents and  approvals required  to
carry on its business as  now conducted, except for  those the absence of  which
would not, individually or  in the aggregate, reasonably  be expected to have  a
Material Adverse Effect on CHSC.  Each  Subsidiary of CHSC is duly qualified  to
do business and is in good standing in each jurisdiction where the character  of
the property owned or leased by  it or the nature  of its activities makes  such
qualification necessary, except for those jurisdictions  where failure to be  so
qualified would not, individually or in  the aggregate, have a Material  Adverse
Effect on CHSC.

     Section 2.13   SEC Filings

     (a)  CHSC has delivered to Farmland (i) its annual report on Form 10-K  for
its fiscal year ended August 31, 1998,  (ii) its quarterly reports on Form  10-Q
for its fiscal  quarters ended after  August 31, 1998,  (iii) all  of its  other
reports, statements, schedules  and registration statements  filed with the  SEC
since August 31, 1998 (the documents  referred to in this Section 2.13(a)  being
referred to collectively as the "CHSC SEC Documents").

     (b)  As of its filing date, each CHSC  SEC Document complied as to form  in
all material  respects  with  the  applicable  requirements  of  the  Securities
Exchange Act of 1934 (the "Exchange Act").

     (c)  As of its filing  date, each CHSC SEC  Document filed pursuant to  the
Exchange Act did not contain any untrue statement of a material fact or omit  to
state any material fact necessary in order to make the statements made  therein,
in the light of the circumstances under which they were made, not misleading.


     Section 2.14   Absence of Certain Changes


     Except as set forth  in the CHSC Disclosure  Schedule, since May 31,  1999,
CHSC and its Subsidiaries have conducted  their business in the ordinary  course
consistent with past practice and there has not been: (a) any event,  occurrence
or development of a state of circumstances or facts which has had or  reasonably
would be expected to have, individually or in the aggregate, a Material  Adverse
Effect on  CHSC;  (b) any  transaction  or  commitment made,  or  any  contract,
agreement  or  settlement  entered  into,  by  (or  judgment,  order  or  decree
affecting) CHSC or any  of its Subsidiaries relating  to its assets or  business
(including the acquisition or disposition of  any assets) or any  relinquishment
by CHSC or any  of its Subsidiaries of  any contract or  other right, in  either
case, material  to  CHSC and  its  Subsidiaries taken  as  a whole,  other  than
transactions,  commitments,  contracts,  agreements  or  settlements  (including
without limitation  settlements  of  litigation  and  tax  proceedings)  in  the
ordinary course of business consistent with past practice, those contemplated by
this Agreement, or as agreed to  in writing by Farmland;  (c) any change in  any
method of  accounting or  accounting practice  (other than  any change  for  tax
purposes) by CHSC or any of its  Subsidiaries, except for any such change  which
is not significant  or which is  required by reason  of a  concurrent change  in
GAAP; or (d) any increase in (or amendments to the terms of) compensation, bonus
or other benefits payable to directors, officers or employees of CHSC or any  of
its Subsidiaries, other than in the ordinary course of business consistent  with
past practice, as permitted  by this Agreement,  or as agreed  to in writing  by
Farmland.


     Section 2.15   Taxes

     Except as set forth in the CHSC Balance Sheet dated May 31, 1999 (including
the notes thereto) and  except as would not,  individually or in the  aggregate,
have a Material Adverse Effect on CHSC, (i) all CHSC Tax Returns required to  be
filed  with  any  taxing  authority  by,  or  with  respect  to,  CHSC  and  its
Subsidiaries have been filed in accordance  with all applicable laws; (ii)  CHSC
and its Subsidiaries have timely paid all Taxes shown as due and payable on  the
CHSC Tax Returns that  have been so filed,  and, as of the  time of filing,  the
CHSC Tax Returns correctly reflected the  facts regarding the income,  business,
assets, operations,  activities and  the status  of  CHSC and  its  Subsidiaries
(other than Taxes which are being contested in good faith and for which adequate
reserves  are  reflected  on  the  CHSC  Balance  Sheet);  (iii)  CHSC  and  its
Subsidiaries have  made  provision  for  all  Taxes  payable  by  CHSC  and  its
Subsidiaries for which no CHSC Tax Return has yet been filed; (iv) the  charges,
accruals and  reserves for  Taxes  with respect  to  CHSC and  its  Subsidiaries
reflected on the CHSC  Balance Sheet are  adequate under GAAP  to cover the  Tax
liabilities accruing through  the date thereof;  (v) there is  no action,  suit,
proceeding, audit or claim  now proposed or pending  against or with respect  to
CHSC or  any  of its  Subsidiaries  in respect  of  any  Tax where  there  is  a
reasonable possibility of  an adverse  determination; and  (vi) to  the best  of
CHSC's knowledge and belief, neither CHSC nor any of its Subsidiaries is  liable
for any Tax imposed on any entity other  than such Person, except as the  result
of the application of Treas. Reg. Section 1.1502-6 (and any comparable provision
of the tax laws of any state,  local or foreign jurisdiction) to the  affiliated
group of  which CHSC  is the  common  parent. For  purposes of  this  Agreement,
"Taxes"  shall  mean  any  and  all  taxes,  charges,  fees,  levies  or   other
assessments, including, without limitation, all net income, gross income,  gross
receipts, excise, stamp,  real or  personal property,  ad valorem,  withholding,
social security (or  similar), unemployment, occupation,  use, service,  service
use, license,  net worth,  payroll, franchise,  severance, transfer,  recording,
employment, premium,  windfall  profits, environmental  (including  taxes  under
Section 59A of  the Internal  Revenue Code of  1986, as  amended (the  "Code")),
customs duties, capital stock,  profits, disability, sales, registration,  value
added, alternative or add-on minimum, estimated  or other taxes, assessments  or
charges imposed by any federal, state, local or foreign governmental entity  and
any interest, penalties, or additions to tax attributable thereto. For  purposes
of this Agreement, "Tax Returns" shall mean any return, report, form or  similar
statement required to be filed with  respect to any Tax (including any  attached
schedules), including,  without limitation,  any information  return, claim  for
refund, amended return or declaration of estimated Tax.


     Section 2.16   Employee Benefit Plans

     (a)  Prior to  the date  hereof, CHSC  has provided  Farmland with  a  list
identifying each material "employee benefit plan," as defined in Section 3(3) of
the Employee Retirement  Income Security Act  of 1974  ("ERISA"), each  material
employment,  severance  or  similar   contract,  plan,  arrangement  or   policy
applicable to any director, former director, employee or former employee of CHSC
and  each  material  plan  or  arrangement  (written  or  oral),  providing  for
compensation, bonuses,  profit-sharing,  stock  option or  other  stock  related
rights or other forms of incentive or deferred compensation, vacation  benefits,
insurance coverage (including any self-insured arrangements), health or  medical
benefits, disability benefits, workers' compensation, supplemental  unemployment
benefits,  severance  benefits  and   post-employment  or  retirement   benefits
(including compensation, pension,  health, medical or  life insurance  benefits)
which is  maintained, administered  or contributed  to by  CHSC and  covers  any
employee or director or former employee or director of CHSC, or under which CHSC
has any  liability. Such  material plans  (excluding  any such  plan that  is  a
"multiemployer plan", as  defined in  Section 3(37)  of ERISA)  are referred  to
collectively herein as the "CHSC Employee Plans".

     (b)  Each CHSC Employee  Plan has been  maintained in  compliance with  its
terms and with  the requirements  prescribed by  any and  all statutes,  orders,
rules and regulations (including  but not limited to  ERISA and the Code)  which
are applicable  to such  Plan, except  where  failure to  so comply  would  not,
individually or in the aggregate, have a Material Adverse Effect on CHSC.

     (c)  Neither CHSC nor any affiliate of CHSC has incurred a liability  under
Title IV of ERISA that has not been  satisfied in full, and no condition  exists
that presents a material risk to CHSC or any affiliate of CHSC of incurring  any
such liability  other  than  liability for  premiums  due  the  Pension  Benefit
Guaranty Corporation (which premiums have been paid when due).

     (d)  Each CHSC  Employee  Plan which  is  intended to  be  qualified  under
Section 401(a) of the Code is so qualified and has been so qualified during  the
period from its  adoption to  date, and  each trust  forming a  part thereof  is
exempt from federal income tax pursuant to Section 501(a) of the Code.

     (e)  No director  or  officer or  other  employee of  CHSC  or any  of  its
Subsidiaries will  become  entitled  to any  retirement,  severance  or  similar
benefit  or  enhanced  or  accelerated  benefit  solely  as  a  result  of   the
transactions contemplated hereby.

     (f)  Each CHSC Employee Plan that  provides for post-retirement health  and
medical, life or other insurance benefits  for retired employees of CHSC or  any
of its  Subsidiaries  has  been adequately  reserved  for  in  CHSC's  financial
statements.

     (g)  There has been no amendment to, written interpretation or announcement
(whether or not written) by CHSC or any of its affiliates relating to, or change
in employee participation or coverage under, any CHSC Employee Plan which  would
increase materially the expense of maintaining such CHSC Employee Plan above the
level of the expense incurred in respect thereof for the 12 months ended May 31,
1999.

     Section 2.17   Environmental Matters

     (a)  Except as set forth in the CHSC SEC Documents filed prior to the  date
hereof and with such exceptions as,  individually or in the aggregate, have  not
had, and would not reasonably be expected to have, a Material Adverse Effect  on
CHSC (i) no  notice, notification,  demand, request  for information,  citation,
summons, complaint or order has been received by, and no investigation,  action,
claim, suit, proceeding or review is pending or, to the knowledge of CHSC or any
of its  Subsidiaries, threatened  by any  Person  against, CHSC  or any  of  its
Subsidiaries, and  no penalty  has been  assessed  against CHSC  or any  of  its
Subsidiaries, in each case, with respect  to any matters relating to or  arising
out of any Environmental Law; (ii) CHSC  and its Subsidiaries are and have  been
in compliance with  all Environmental Laws;  (iii) there are  no liabilities  of
CHSC or any of its Subsidiaries relating to or arising out of any  Environmental
Law of any kind whatsoever,  whether accrued, contingent, absolute,  determined,
determinable or otherwise, and there is no existing condition, situation or  set
of circumstances  which  could  reasonably  be expected  to  result  in  such  a
liability; and (iv) there has been no environmental investigation, study, audit,
test, review or other analysis conducted of which CHSC has knowledge in relation
to the current  or prior  business of CHSC  or any  of its  Subsidiaries or  any
property or facility now or previously owned, leased or operated by CHSC or  any
of its Subsidiaries which has not been delivered to Farmland at least five  days
prior to the date hereof.   All liabilities of CHSC  or any of its  Subsidiaries
relating to or arising out of any Environmental Law of any kind whatsoever  have
been adequately  reserved  for on  the  financial  statements of  CHSC,  or  for
unconsolidated Subsidiaries, on the financial statements of such Subsidiaries.

     (b)  For purposes of  this Agreement, the  term "Environmental Laws"  means
any federal,  state,  local  and  foreign  statutes,  laws  (including,  without
limitation, common  law), judicial  decisions, regulations,  ordinances,  rules,
judgments, orders,  codes,  injunctions,  permits,  governmental  agreements  or
governmental restrictions relating to human  health and safety, the  environment
or to pollutants, contaminants, wastes, or chemicals.


     Section 2.18   Pooling; Tax Treatment


     The parties intend that the Transaction be accounted for under the "pooling
of interests"  method  under  the  requirements  of  Opinion  No.  16  (Business
Combinations) of the Accounting  Principles Board of  the American Institute  of
Certified Public Accountants, the Financial Accounting Standards Board, and  the
rules and regulations of the Securities  and Exchange Commission.  Neither  CHSC
nor any of its affiliates has taken or agreed to take any action or is aware  of
any fact or circumstance that would prevent the Transaction from qualifying  (i)
for "pooling of interests" accounting treatment as described above or (ii) as  a
reorganization  within  the  meaning  of  Section  368  of  the  Code  (a   "368
Reorganization").

     Section 2.19  No  Dissenters Rights

     No member of CHSC  or any other holder  of equity of  CHSC, other than  the
holders of Equity Participation Units as defined in CHSC's Bylaws and as further
defined in resolutions of the CHSC  board of directors establishing the  defined
business units to which such Equity  Participation Units relate, have the  right
to dissent from the Transaction and  receive payment for their interest in  cash
or otherwise receive any  property or other interest  in the Transaction,  other
than as provided in the Plan of Merger.


     Section 2.20   Acquisition Co.

     Acquisition Co. has been formed by CHSC solely for the purpose of  carrying
out the  Transaction  if  Structure  B  is  selected.    Acquisition  Co.  is  a
"Subsidiary" of CHSC  for purposes  hereof.  Acquisition  Co. has  no assets  or
liabilities, other  than  nominal  assets  to  comply  with  any  organizational
requirements of Ohio law.


     Section 2.21   Full Disclosure


     CHSC has  disclosed to  Farmland all  facts  material to  the  transactions
contemplated in this Agreement, including  disclosure of all material  contracts
(as such term is described  in Item 601 of  Regulation S-K under the  Securities
Act of 1933, as  amended ("Regulation S-K")).   No representation, warranty,  or
covenant by CHSC  contained in  this Agreement  or the  Plan of  Merger, and  no
statement  contained  in  any  certificate,  schedule,  or  other  documents  or
instrument furnished  to Farmland  pursuant hereto  or  in connection  with  the
transactions contemplated hereby,  including responses to Farmland inquiries put
to CHSC  in  the course  of  its investigation  to  confirm the  warranties  and
representations of CHSC in  this Agreement, when taken  as a whole, contains  or
will contain any untrue  statement of a material  fact or omits  or will omit  a
material fact which would make it misleading as to CHSC.

                                  ARTICLE III

    REPRESENTATIONS AND WARRANTIES OF FARMLAND


     Farmland represents and warrants to CHSC and the Surviving Entity that  the
statements contained  in  this Article  III  are  correct and  complete  in  all
material respects as of the date of this  Agreement, except as set forth in  the
Farmland  Disclosure  Schedule   attached  hereto   (the  "Farmland   Disclosure
Schedule").   Nothing  in  the Farmland  Disclosure  Schedule  shall  be  deemed
adequate to disclose an  exception to a representation  or warranty made  herein
unless  the  Farmland   Disclosure  Schedule  identifies   the  exception   with
particularity and describes the relevant facts in detail.  Without limiting  the
generality of the  foregoing, the mere  listing (or inclusion  of a  copy) of  a
document or other item shall not be deemed adequate to disclose an exception  to
a representation or warranty made herein (unless the representation or  warranty
has to do with the existence of the document or other item itself).

     Section 3.01   Organization and Good Standing

     Farmland is a  cooperative corporation  duly organized  and existing  under
Chapter 17, Article 16  of the Kansas  Statutes, is in  good standing under  the
laws of the State of Kansas, and has all requisite corporate power and authority
to own  its  properties  and conduct  its  business  as it  is  presently  being
conducted.  Farmland is duly qualified to do business and is in good standing in
each jurisdiction in which it conducts business or owns or leases properties  of
a nature which would require such qualification, except for those  jurisdictions
where the  failure  to  be  so  qualified would  not,  individually  or  in  the
aggregate, have a Material Adverse Effect on Farmland.  Farmland has  heretofore
delivered to  Farmland true  and complete  copies of  the Farmland  articles  of
incorporation and bylaws as currently in effect.
 .

     Section 3.02   Financial Statements


     Farmland has delivered to CHSC (a)  its audited financial statements as  of
August 31, 1998, accompanied  by the opinion of  KPMG-Peat Marwick, and (b)  its
unaudited financial statements  for the nine  months ended May  31, 1999.   Such
financial statements fairly present the financial position
of Farmland at the dates indicated therein and the results of its operation  for
the periods  indicated therein,  in conformity  with GAAP.   There  has been  no
material adverse change in the financial  condition or results of operations  of
Farmland since May 31, 1999.


     Section 3.03   Absence of Liabilities


     Neither Farmland  nor any  Subsidiary of  Farmland has  any liabilities  or
obligations, absolute  or contingent,  except  for liabilities  and  obligations
which are (i) reflected in the financial statements referred to in Section 3.02,
(ii) fully  covered by  insurance, except  for reasonable  deductibles or  self-
insured retention  levels, (iii)  incurred in  the ordinary  course of  business
since May 31, 1999  and not materially  different in type  or amount from  those
reflected in the financial statements referred to in Section 3.02, or (iv) would
not in the aggregate reasonably be expected to have a Material Adverse Effect on
Farmland.


     Section 3.04   Title to PropertyS


     Except as  reflected  in  the  notes  accompanying  the  audited  financial
statements of Farmland, Farmland has good  and marketable title to all real  and
personal property reflected as owned on the books and records of Farmland as  of
the date of  this Agreement and  owns outright all  other assets, properties  or
property interests acquired since that date, in each case free of all mortgages,
liens, charges and  encumbrances, other  than (i)  easements, rights-of-way  and
similar encumbrances which  do not  materially impair the  use of  such real  or
personal property for  the same  or similar purposes  as such  real or  personal
property has been used by Farmland prior  to the Effective Time, (ii) liens  for
current taxes that  are not  yet due  and payable,  (iii) liens  related to  the
acquisition of inventory or otherwise arising in the normal course of  business,
and (iv) other liens, encumbrances and title defects which would not  reasonably
be expected to have a Material Adverse Effect on Farmland.


     Section 3.05   Intellectual Property

     Farmland owns  or possesses,  is licensed  under  or otherwise  has  lawful
access to, all patents, trade secrets, know-how, other confidential information,
trademarks, service marks, copyrights, trade names, logos and other intellectual
property, whether registered or unregistered,  necessary for the lawful  conduct
of its business as currently conducted, without any infringement of or  conflict
with the industrial or intellectual property  rights of any third party,  except
as would  not  reasonably be  expected  to have  a  Material Adverse  Effect  on
Farmland.  Farmland does not know or have reason to know of any unauthorized use
or disclosure or  misappropriation of any  of its  intellectual property.  which
disclosure, use,  or misappropriation  would reasonably  be expected  to have  a
Material Adverse Effect on Farmland.


     Section 3.06   Compliance with Laws, etc.

     Farmland is  in compliance  with all  applicable laws  and regulations  the
violation of  which would  reasonably be  expected to  have a  Material  Adverse
Effect on Farmland.   Farmland  has all  governmental authorizations,  consents,
licenses and  permits required  by law  or otherwise  necessary for  the  proper
operation of  its business  as currently  conducted, all  of such  licenses  and
permits are in full force and effect, and no action to terminate, withdraw,  not
renew or materially  limit or  otherwise change any  such license  or permit  is
pending or has been threatened by any governmental agency or other party, except
as would  not  reasonably be  expected  to have  a  Material Adverse  Effect  on
Farmland.


     Section 3.07   Pending  Litigation,   Claims,   Actions,   Proceedings
     or
     Investigations

     There is no action, proceeding or investigation pending against, or to  the
best of  the  knowledge of  Farmland  after reasonable  inquiry,  is  threatened
against Farmland or any Subsidiary  of Farmland or any  of the assets which  are
owned by  Farmland or  any  Subsidiary of  Farmland  which would  reasonably  be
expected to have a Material Adverse Effect on Farmland.


     Section 3.08   Absence of Defaults


     Farmland is  not  in  default  under  any  provision  of  its  Articles  of
Incorporation or  Bylaws or  any indenture,  mortgage, loan  agreement or  other
material agreement to which it is a party or by which it is bound, and  Farmland
is not in violation of any  statute, order, rule or  regulation of any court  or
governmental agency having  jurisdiction over it  or its  properties, which,  in
each case, could have a Material Adverse Effect on Farmland, and, except for any
consent or approval identified on the Farmland Disclosure Schedule, neither  the
execution and delivery of this Agreement nor the consummation of the Transaction
in accordance with this Agreement will in any respect conflict with or result in
a breach of any of the foregoing, which could have a Material Adverse Effect  on
Farmland.

     Section 3.09   Authorization

     Farmland has the corporate power and authority to enter into and to perform
its obligations under this Agreement (subject to the approvals of its members as
required by Section 5.01(b)).  This Agreement and the Transaction have been duly
and validly authorized by  the Board of Directors  of Farmland, and (except  for
the approvals of its members as required by Section 5.01(b)) no other  corporate
action is  required  by  Farmland  in connection  with  this  Agreement  or  the
Transaction.   This Agreement  constitutes the  valid and  binding agreement  of
Farmland, enforceable against Farmland in accordance  with its terms, except  to
the extent  such enforcement  may be  limited by  the application  of  equitable
principles where  equitable  relief  is sought  or  bankruptcy  and  other  laws
relating to the enforcement of creditors' rights generally.


     Section 3.10   Insurance


     Farmland has secured appropriate insurance policies which (i) are issued by
sound and reputable insurance companies duly authorized to write said insurance,
(ii) are in full force and effect, (iii) are sufficient for compliance with  all
requirements of law and all  agreements to which Farmland  is a party, and  (iv)
provide reasonable insurance coverage for the assets and operations of  Farmland
and all liabilities related thereto.


     Section 3.11   Governmental Authorization


     The execution, delivery and performance by  Farmland of this Agreement  and
the consummation  of the  Transaction by  Farmland require  no action  by or  in
respect of, or filing with, any governmental body, agency, official or authority
other than (a) the filing of appropriate documents to effect the Plan of  Merger
under applicable law, (b) compliance with any applicable requirements of the HSR
Act, and (c)  other actions or  filings which if  not taken or  made would  not,
individually or in the aggregate, have a Material Adverse Effect on Farmland  or
the Surviving Entity following the Effective Time.


     Section 3.12   Subsidiaries

     Each Subsidiary of Farmland is duly organized, validly existing and in good
standing under the laws of its jurisdiction of organization, has all powers  and
all governmental licenses,  authorizations, consents and  approvals required  to
carry on its business as  now conducted, except for  those the absence of  which
would not, individually or  in the aggregate, reasonably  be expected to have  a
Material Adverse  Effect on  Farmland.   Each  Subsidiary  of Farmland  is  duly
qualified to do business and is in good standing in each jurisdiction where  the
character of the property owned or leased by it or the nature of its  activities
makes such qualification necessary, except for those jurisdictions where failure
to be so qualified would not, individually or in the aggregate, have a  Material
Adverse Effect on Farmland.


     Section 3.13   SEC Filings

     (a)  Farmland has delivered to CHSC (i) its annual report on Form 10-K  for
its fiscal year ended August 31, 1998,  (ii) its quarterly reports on Form  10-Q
for its fiscal  quarters ended after  August 31, 1998,  (iii) all  of its  other
reports, statements, schedules  and registration statements  filed with the  SEC
since August 31, 1998  (the documents referred to in this Section 3.13(a)  being
referred to collectively as the "Farmland SEC Documents").

     (b)  As of its filing date, each Farmland SEC Document complied as to  form
in all material respects with the applicable requirements of the Exchange Act.

     (c)  As of its filing  date, each Farmland SEC  Document filed pursuant  to
the Exchange Act did not contain any untrue statement of a material fact or omit
to state  any material  fact necessary  in  order to  make the  statements  made
therein, in  the light  of the  circumstances under  which they  were made,  not
misleading.


     Section 3.14   Absence of Certain Changes


     Except as set  forth in  the Farmland  Disclosure Schedule,  since May  31,
1999, Farmland  and  its  Subsidiaries have  conducted  their  business  in  the
ordinary course consistent with  past practice and there  has not been: (a)  any
event, occurrence or development of a state of circumstances or facts which  has
had or reasonably would be expected to have, individually or in the aggregate, a
Material Adverse Effect on Farmland; (b) any transaction or commitment made,  or
any contract, agreement or  settlement entered into, by  (or judgment, order  or
decree affecting) Farmland or any of its Subsidiaries relating to its assets  or
business (including  the  acquisition  or disposition  of  any  assets)  or  any
relinquishment by Farmland or any of  its Subsidiaries of any contract or  other
right, in either  case, material  to Farmland and  its Subsidiaries  taken as  a
whole,  other   than  transactions,   commitments,  contracts,   agreements   or
settlements (including  without limitation  settlements  of litigation  and  tax
proceedings) in the ordinary course of  business consistent with past  practice,
those contemplated by this Agreement,  or as agreed to  in writing by CHSC;  (c)
any change in any  method of accounting or  accounting practice (other than  any
change for tax purposes) by Farmland or any of its Subsidiaries, except for  any
such change  which is  not significant  or  which is  required  by reason  of  a
concurrent change in GAAP; or  (d) any increase in  (or amendments to the  terms
of) compensation,  bonus or  other benefits  payable to  directors, officers  or
employees of Farmland  or any of  its Subsidiaries, other  than in the  ordinary
course  of  business  consistent  with  past  practice,  as  permitted  by  this
Agreement, or as agreed to in writing by CHSC.


     Section 3.15   Taxes

     Except as  set forth  in the  Farmland  Balance Sheet  dated May  31,  1999
(including the notes thereto)  and except as would  not, individually or in  the
aggregate, have a  Material Adverse  Effect on  Farmland, (i)  all Farmland  Tax
Returns required to be filed with any  taxing authority by, or with respect  to,
Farmland and its Subsidiaries have been filed in accordance with all  applicable
laws; (ii) Farmland and its Subsidiaries have timely paid all Taxes shown as due
and payable on the Farmland Tax Returns that have been so filed, and, as of  the
time of filing, the Farmland Tax Returns correctly reflected the facts regarding
the income, business, assets, operations, activities and the status of  Farmland
and its Subsidiaries (other than Taxes  which are being contested in good  faith
and for which adequate  reserves are reflected on  the Farmland Balance  Sheet);
(iii) Farmland and its Subsidiaries have made provision for all Taxes payable by
Farmland and its  Subsidiaries for  which no Farmland  Tax Return  has yet  been
filed; (iv)  the  charges, accruals  and  reserves  for Taxes  with  respect  to
Farmland and  its  Subsidiaries reflected  on  the Farmland  Balance  Sheet  are
adequate under  GAAP to  cover the  Tax liabilities  accruing through  the  date
thereof; (v) there is no action,  suit, proceeding, audit or claim now  proposed
or pending against or  with respect to  Farmland or any  of its Subsidiaries  in
respect of  any  Tax where  there  is a  reasonable  possibility of  an  adverse
determination; and (vi) to the best of Farmland's knowledge and belief,  neither
Farmland nor any of its Subsidiaries is liable for any Tax imposed on any entity
other than such Person, except as the  result of the application of Treas.  Reg.
Section 1.1502-6 (and  any comparable provision  of the tax  laws of any  state,
local or foreign jurisdiction) to the affiliated group of which Farmland is  the
common parent.


     Section 3.16   Employee Benefit Plans

     (a)  Prior to  the date  hereof, Farmland  has provided  CHSC with  a  list
identifying each material "employee benefit plan," as defined in Section 3(3) of
ERISA,  each  material   employment,  severance  or   similar  contract,   plan,
arrangement or policy applicable to any  director, former director, employee  or
former employee of Farmland  and each material plan  or arrangement (written  or
oral), providing  for compensation,  bonuses,  profit-sharing, stock  option  or
other stock related rights or other forms of incentive or deferred compensation,
vacation benefits, insurance coverage (including any self-insured arrangements),
health  or  medical  benefits,   disability  benefits,  workers'   compensation,
supplemental unemployment benefits,  severance benefits  and post-employment  or
retirement benefits (including  compensation, pension, health,  medical or  life
insurance benefits)  which  is maintained,  administered  or contributed  to  by
Farmland and covers any employee or  director or former employee or director  of
Farmland, or  under  which  Farmland has  any  liability.  Such  material  plans
(excluding any such plan that is  a "multiemployer plan", as defined in  Section
3(37) of ERISA) are  referred to collectively herein  as the "Farmland  Employee
Plans".

     (b)  Each Farmland Employee Plan has been maintained in compliance with its
terms and with  the requirements  prescribed by  any and  all statutes,  orders,
rules and regulations (including  but not limited to  ERISA and the Code)  which
are applicable  to such  Plan, except  where  failure to  so comply  would  not,
individually or in the aggregate, have a Material Adverse Effect on Farmland.

     (c)  Neither  Farmland  nor  any  affiliate  of  Farmland  has  incurred  a
liability under Title IV of ERISA  that has not been  satisfied in full, and  no
condition exists that presents a material  risk to Farmland or any affiliate  of
Farmland of incurring any such liability  other than liability for premiums  due
the Pension Benefit  Guaranty Corporation (which  premiums have  been paid  when
due).

     (d)  Each Farmland Employee Plan  which is intended  to be qualified  under
Section 401(a) of the Code is so qualified and has been so qualified during  the
period from its  adoption to  date, and  each trust  forming a  part thereof  is
exempt from federal income tax pursuant to Section 501(a) of the Code.

     (e)  No director or  officer or other  employee of Farmland  or any of  its
Subsidiaries will  become  entitled  to any  retirement,  severance  or  similar
benefit  or  enhanced  or  accelerated  benefit  solely  as  a  result  of   the
transactions contemplated hereby.

     (f)  Each Farmland Employee Plan  that provides for post-retirement  health
and medical, life or other insurance benefits for retired employees of  Farmland
or any  of its  Subsidiaries  has been  adequately  reserved for  in  Farmland's
financial statements.

     (g)  There has been no amendment to, written interpretation or announcement
(whether or not written) by  Farmland or any of  its affiliates relating to,  or
change in employee participation or coverage  under, any Farmland Employee  Plan
which would  increase  materially  the  expense  of  maintaining  such  Farmland
Employee Plan above the level of the expense incurred in respect thereof for the
12 months ended May 31, 1999.

     Section 3.17   Environmental Matters    Except  as  set
forth in the Farmland SEC Documents filed prior to the date hereof and with such
exceptions as, individually  or in the  aggregate, have not  had, and would  not
reasonably be expected  to have, a  Material Adverse Effect  on Farmland (i)  no
notice,  notification,  demand,  request  for  information,  citation,  summons,
complaint or order has  been received by, and  no investigation, action,  claim,
suit, proceeding or review is pending or, to the knowledge of Farmland or any of
its Subsidiaries,  threatened by  any Person  against, Farmland  or any  of  its
Subsidiaries, and no penalty  has been assessed against  Farmland or any of  its
Subsidiaries, in each case, with respect  to any matters relating to or  arising
out of any Environmental  Law; (ii) Farmland and  its Subsidiaries are and  have
been in compliance with all Environmental  Laws; (iii) there are no  liabilities
of Farmland  or any  of its  Subsidiaries  relating to  or  arising out  of  any
Environmental Law of any kind whatsoever, whether accrued, contingent, absolute,
determined, determinable  or  otherwise, and  there  is no  existing  condition,
situation or set of circumstances which  could reasonably be expected to  result
in such a  liability; and (iv)  there has been  no environmental  investigation,
study, audit, test,  review or other  analysis conducted of  which Farmland  has
knowledge in relation to the current or prior business of Farmland or any of its
Subsidiaries or any  property or  facility now  or previously  owned, leased  or
operated by Farmland or any of its Subsidiaries which has not been delivered  to
CHSC at least five days prior to the  date hereof.  All liabilities of  Farmland
or any of its Subsidiaries relating to  or arising out of any Environmental  Law
of any  kind whatsoever  have  been adequately  reserved  for on  the  financial
statements of Farmland,  or for  unconsolidated Subsidiaries,  on the  financial
statements of such Subsidiaries.


     Section 3.18   Pooling; Tax Treatment


     The parties intend that the Transaction be accounted for under the "pooling
of interests"  method  under  the  requirements  of  Opinion  No.  16  (Business
Combinations) of the Accounting  Principles Board of  the American Institute  of
Certified Public Accountants, the Financial Accounting Standards Board, and  the
rules and  regulations  of the  Securities  and Exchange  Commission.    Neither
Farmland nor any of its affiliates has taken or agreed to take any action or  is
aware of  any fact  or  circumstance that  would  prevent the  Transaction  from
qualifying (i)  for "pooling  of interests"  accounting treatment  as  described
above or (ii) as a 368 Reorganization.

     Section 3.19   No Dissenters' Rights

     No member of Farmland or  any other holder of  equity of Farmland have  the
right to dissent from the Transaction and receive payment for their interest  in
cash or otherwise  receive any property  or other interest  in the  Transaction,
other than as provided in the Plan of Merger.



     Section 3.20   Full Disclosure


     Farmland has  disclosed to  CHSC all  facts  material to  the  transactions
contemplated in this Agreement, including  disclosure of all material  contracts
(as such term is described in Item  601 of Regulation S-K).  No  representation,
warranty, or covenant  by Farmland contained  in this Agreement  or the Plan  of
Merger, and  no  statement contained  in  any certificate,  schedule,  or  other
documents or instrument furnished to CHSC pursuant hereto or in connection  with
the transactions contemplated hereby, including responses to CHSC inquiries  put
to Farmland in  the course of  its investigation to  confirm the warranties  and
representations of Farmland in this Agreement,  when taken as a whole,  contains
or will contain any untrue statement of a material fact or omits or will omit  a
material fact which would make it misleading as to Farmland.

                                   ARTICLE IV

 PRE-CLOSING COVENANTS


     The parties  agree  as follows  with  respect  to the  period  between  the
execution of this Agreement and the Closing Date:


     Section 4.01   Selection of Structure


     The board of directors of each of CHSC and Farmland shall work together  to
determine whether  Structure A  or Structure  B shall  be selected  as the  most
appropriate structure for  the Transaction.   If Structure B  is selected,  CHSC
agrees to take such action as the sole member of Acquisition Co., or  otherwise,
to permit Acquisition Co. to take such actions as may be necessary to effect the
CHSC/Acquisition Co. Merger pursuant to applicable law, it being understood that
following such  Merger  the  Surviving  Entity  shall  be  reincorporated  as  a
cooperative association under Chapter 308A of the Minnesota Statutes as soon  as
practicable after the  issue or issues  that precluded use  of Structure A  have
been resolved,  unless the  board of  directors of  the Surviving  Entity, by  a
three-fourths (3/4) vote, determines otherwise.

     Section 4.02   Good Faith Efforts

     Each party will use its good faith efforts (i) to take all action necessary
to render accurate, as of the  Closing Date, its representations and  warranties
contained herein, and to refrain from  taking any action which would render  any
such representation  or warranty  inaccurate as  of the  Closing Date,  (ii)  to
perform or cause to be satisfied each  covenant or condition to be performed  or
satisfied by it pursuant to this Agreement or  the Plan of Merger, and to  cause
the Transaction to  be consummated, and  (iii) to obtain  all licenses or  other
approvals required to  be obtained by  it from any  appropriate governmental  or
regulatory body  or other  person in  connection with  the carrying  out of  the
Transaction and  the continued  operation of  business by  the Surviving  Entity
after the Closing Date, including without limitation the consents and  approvals
identified in each party's Disclosure Schedule.


     Section 4.03   Preservation of Business


     Each party shall, and shall cause each of its Subsidiaries to, conduct  its
business in  the  ordinary course  and  in a  manner  consistent with  its  past
practices (except as expressly  contemplated hereby), and  shall use good  faith
efforts to preserve intact its business organization, properties (except as they
may be sold, used or otherwise disposed of in the ordinary course) and the  good
will  of  its   members,  suppliers,  customers   and  others  having   business
relationships with it.

     Section 4.04   Conduct of Business

     Each Party  agrees to  not engage  in ,  and agrees  to cause  each of  its
Subsidiaries not to engage in, any practice, take any action, or enter into  any
transaction outside of the ordinary course of business without the prior consent
of the other party to  this Agreement.  Without  limiting the generality of  the
foregoing, each party  shall not  and each  party agrees  to cause  each of  its
Subsidiaries to not:

          (a)  grant to any  person any option  to purchase, or  other right  to
     acquire, capital stock or other equity interests, except for allocation  of
     patronage equities in a manner consistent with past practice;

          (b)  issue any capital stock or other equity interests, except in  the
     ordinary course of business;

          (c)  make any  material  amendment  to enter  into  or  terminate  any
     material contract, lease or understanding;

          (d)  amend  its  Articles  of  Incorporation,  Bylaws,  or  any  board
     policies;

          (e)  incur any indebtedness for borrowed money or make any  commitment
     to borrow money,  except indebtedness incurred  in the  ordinary course  of
     business pursuant to credit  arrangements existing as of  the date of  this
     Agreement (including any renewals thereof);

          (f)  make any material capital expenditures other than in the ordinary
     course of business;
          (g)  mortgage any of its assets, or  except in the ordinary course  of
     business, sell any of its assets  having an aggregate value which would  be
     material to its business;

          (h)  pay any dividends or make any  distributions with respect to  its
     capital stock  or  equity  interests, except  in  the  ordinary  course  of
     business;

          (i)  reclassify, combine, subdivide,  split-up, or  amend its  capital
     stock or equity interests;

          (j)  purchase, acquire or redeem any shares of capital stock or  other
     equity interests (other than in  satisfaction of allocated losses),  except
     pursuant to the existing equity redemption/base capital plans of the party;
     or

          (k)  agree or commit to do any of the foregoing.


     Section 4.05   Meetings of Members

     The parties will  take all  steps necessary  to call  special meetings  of,
and/or mail votes by, the members of Farmland and CHSC, to be held on or  around
November 23, 1999 for purposes of considering and voting on the Transaction  and
other matters  covered by  this Agreement  in accordance  with their  respective
Articles of  Incorporation,  Bylaws  and  applicable  law.    The  parties  will
cooperate with each other in connection with the special member meetings  and/or
mail votes  and will  develop  a mutually  agreed  upon plan  for  disseminating
information concerning  the  Transaction  to their  members  (including  holding
member information meetings and  preparation of a joint  statement of terms  and
conditions to be mailed to members).

     Section 4.06   Full Access

     Each party will permit the authorized representatives of the other party to
have full access at all reasonable times, and in a manner so as not to interfere
with the normal business operations of such party, to all premises,  properties,
personnel, books, records (including tax  records), contracts, and documents  of
or pertaining to such party.  The obligations of each party with respect to  any
"Confidential  Information"  (as   such  term   is  defined   in  that   certain
Confidentiality  Agreement  between  the  parties  dated  April  8,  1999   (the
"Confidentiality Agreement")) furnished by the other party shall be governed  in
all  respects  by  the  Confidentiality  Agreement,  the  terms  of  which   are
incorporated herein by this reference.  If for any reason the Transaction is not
consummated, each  party  will promptly  return  all documents,  papers,  books,
records and other materials (and all copies thereof) embodying any  Confidential
Information obtained in the course of its investigation and evaluation.


Section 4.07   Notice of Developments


     Each party will give prompt written notice to the other of any  development
which could reasonably  be expected to  result in a  Material Adverse Effect  on
such party or  which would  cause a  breach of  any of  its representations  and
warranties contained herein.   Except as  specified in such  written notice,  no
disclosure by a party pursuant to this Section 4.07 shall be deemed to amend  or
supplement  such  party's  Disclosure  Schedule  or  to  prevent  or  cure   any
misrepresentation, breach of warranty, or breach of covenant.


     Section 4.08   Exclusive


     Neither party will (i)  solicit, initiate, or  encourage the submission  of
any proposal or offer from any person relating to the acquisition of any capital
stock or other voting securities, or  any substantial portion of the assets  of,
such party (including any acquisition structured as a merger, consolidation,  or
share  exchange)  or  (ii)  participate  in  any  discussions  or   negotiations
regarding, furnish any information with respect to, assist or participate in, or
facilitate in any other manner any effort or attempt by any person to do or seek
any of the foregoing.  Each party will notify the other party immediately if any
person makes any proposal, offer, inquiry, or contact with respect to any of the
foregoing.


     Section 4.09   Hart-Scott-Rodino Filings


     CHSC and Farmland shall prepare and file with the Antitrust Division of the
U.S. Justice  Department  (the  "Antitrust  Division")  and  the  Federal  Trade
Commission (the "FTC"), all reports required to be filed in connection with  the
Transaction pursuant to the HSR Act.  Each of CHSC and Farmland shall  cooperate
fully with each other in preparation of  such reports.  If either the  Antitrust
Division or the FTC  requests that additional information  be filed pursuant  to
the HSR Act, CHSC and HSR shall prepare and file such additional information  as
soon as practicable after the request, and shall cooperate fully with each other
in preparation of such  additional information. With  respect to preparation  or
filing of any of the reports or additional information described in this Section
4.09, each party shall bear its own costs.


     Section 4.10   Tax and Accounting Treatment


     Each of the parties shall not  take any action and  shall not fail to  take
any action, which action or failure to act would prevent, or would be reasonably
likely  to  prevent,  the  Transaction  from  qualifying  (a)  for  "pooling  of
interests" accounting treatment as described in  Sections 2.19 and 3.19, or  (b)
as a 368 Reorganization.


                                   ARTICLE V
    CLOSING CONDITIONS


     Section 5.01   Conditions to Obligations of Each Party

     The  respective  obligations  of  CHSC  and  Farmland  to  consummate   the
Transaction and  other  matters  described  in  this  Agreement  are,  at  their
respective options,  subject  to the  satisfaction  or  waiver of  each  of  the
following conditions on or before the Closing Date:

          (a)  The members of CHSC shall have approved this Agreement, the  Plan
     of Merger, and the Transaction, all in accordance with the requirements  of
     applicable law and the Articles of Incorporation and Bylaws of CHSC;

          (b)  The members of Farmland shall  have approved this Agreement,  the
     Plan  of  Merger,  and  the  Transaction,   all  in  accordance  with   the
     requirements of applicable law and the Articles of Incorporation and Bylaws
     of Farmland;

          (c)  If Structure B is to be used to effect the combination, all steps
     then legally feasible to reincorporate the Surviving Entity as a  Minnesota
     cooperative association (as  described in Section  4.01 hereof) shall  have
     been taken;

          (d)  The parties shall have made the filings required by Section  4.09
     above under the HSR Act, and all applicable time periods under the HSR  Act
     shall have expired;
          (e)  No injunction, restraining order or order of any nature issued by
     any court  of competent  jurisdiction,  government or  governmental  agency
     enjoining the Transaction shall have been issued and remain in effect;

          (f)  All consents,  approvals  and  waivers  which  are  necessary  in
     connection with  the Transaction,  or any  part  thereof, shall  have  been
     obtained, including the consents and approvals referred to in Section  4.02
     above, other  than  any such  consents,  approvals  or waiver  as  do  not,
     individually or in  the aggregate, have  a Material Adverse  Effect on  the
     Surviving Entity; and

          (g)  No action  shall  have  been  threatened  or  instituted  by  any
     governmental agency or  any other person  challenging the  legality of  the
     Transaction, seeking to prevent or delay consummation of the Transaction or
     seeking to obtain divestiture or other relief in the event of  consummation
     of the Transaction.  It is understood in  the event that such an action  is
     threatened or instituted, the parties will first attempt for a period of 90
     days to obtain dismissal or other  favorable resolution of such  threatened
     or actual action prior to exercise of their right to terminate hereunder.


     Section 5.02   Additional Conditions to Obligation of CHSC

     The obligation of  CHSC to consummate  the Transaction is,  at its  option,
subject to  the satisfaction  or  waiver of  each  of the  following  additional
conditions at the Closing Date.

          (a)  All the representations and  warranties of Farmland contained  in
     this Agreement shall be  true and correct in  all material respects on  the
     Closing Date as though such representations and warranties were made on and
     as of  the Closing  Date, and  Farmland  shall have  performed all  of  its
     obligations and  complied  with all  of  its covenants  contained  in  this
     Agreement and in the Plan of Merger to be performed or complied with  prior
     to the Closing Date;

          (b)  There shall have occurred no change since the date hereof in  the
     assets, liabilities, financial condition  or operations of Farmland  which,
     in the reasonable judgment  of CHSC, has  or is likely  to have a  Material
     Adverse Effect on the Surviving Entity; provided, however, that an  adverse
     ruling in the Terra tax case referred to  on Exhibit D hereto shall not
     be  considered as such a change;

          (c)  CHSC shall have received a certificate,  dated as of the  Closing
     Date, and executed by the President of Farmland, certifying in such  detail
     as CHSC may reasonably request as  to the accuracy of such  representations
     and warranties, the fulfillment of  such obligations, compliance with  such
     covenants and satisfaction of the conditions to CHSC's obligation as of the
     Closing Date; and

          (d)  All actions, proceedings and documents necessary to carry out the
     Transaction shall be reasonably satisfactory to CHSC


     Section 5.03   Additional Conditions to Obligation of Farmland

     The obligation of Farmland to consummate the Transaction is, at its option,
subject to  the satisfaction  or  waiver of  each  of the  following  additional
conditions on or before the Closing Date:

          (a)  All the representations and warranties of CHSC contained in  this
     Agreement shall be true and correct in all material respects on the Closing
     Date as though such representations and  warranties were made on and as  of
     the Closing Date, and CHSC shall have performed all of its obligations  and
     complied with all of its covenants  contained in this Agreement and in  the
     Plan of Merger to be performed or complied with prior to the Closing Date;

          (b)  There shall have occurred no change since the date hereof in  the
     assets, liabilities, financial  condition or operations  of CHSC which,  in
     the reasonable judgment of  Farmland, has or is  likely to have a  Material
     Adverse Effect on the Surviving Entity;

          (c)  Farmland shall  have  received a  certificate,  dated as  of  the
     Closing Date, executed by the President of CHSC, certifying in such  detail
     as  Farmland  may   reasonably  request  as   to  the   accuracy  of   such
     representations  and  warranties,  the  fulfillment  of  such  obligations,
     compliance with  such  covenants  and satisfaction  of  the  conditions  to
     Farmland's obligations as of the Closing Date; and

          (d)  All actions, proceedings and documents necessary to carry out the
     Transaction shall  be reasonably  satisfactory to  Farmland, including  the
     effectiveness of  the  CHSC/Acquisition  Co.  Merger,  if  Structure  B  is
     selected.

                                   ARTICLE VI

   POST-CLOSING AGREEMENTS

     With respect to issues relating to  the Surviving Entity subsequent to  the
Effective Time, CHSC and Farmland agree as follows:


     Section 6.01   Consolidation of Benefit Plans

     Within a reasonable period of time after the Effective Time, the  Surviving
Entity shall take steps to consolidate the various benefit plans provided to the
employees of the respective parties in accordance with the applicable provisions
of the Code and ERISA.  This consolidation  of plans shall be accomplished in  a
manner to be determined by the Surviving Entity.


     Section 6.02   Patronage Distributions


     Following the  Effective  Time  and within  the  time  period  required  by
Subchapter T of the Code, the  Surviving Entity will make patronage  allocations
to the former members of each party (a) based on patronage transactions with the
respective parties during each party's respective fiscal year or portion thereof
immediately preceding the Effective Time and (b) in accordance with the terms of
the bylaws of  the party that  are in effect  during the  period such  patronage
transaction occurred.  The distributions of such allocation shall be in the form
of cash and equity  credits in a manner  consistent with the previous  patronage
distributions of each party.

     Section 6.03   Indemnification of Former Officers; Insurance

     The surviving  Entity  shall  indemnify each  director,  officer,  manager,
employee or agent of CHSC or Farmland, and each person serving at the request of
CHSC or Farmland as a director, officer, manager, employee or agent of any other
entity, partnership, joint  venture, trust  or enterprise,  against any  losses,
claims or expenses  incurred by  such person prior  to the  Effective Time  that
would be indemnifiable under Bylaws of the  Surviving Entity as in force on  the
Effective Time and otherwise to the fullest extent provided or permitted by  any
statute which applies to any type  of corporation of the state of  incorporation
of the Surviving Entity as in effect at  such time.  The Surviving Entity  shall
maintain insurance coverage against any such loss, claim or expense in an amount
of at  least  $20,000,000, subject  to  standard exclusions  and  exceptions  to
coverage, for a period of not less than six (6) years after the Effective  Time,
subject to the right of the Board  of Directors to discontinue such coverage  on
grounds of unreasonable cost.

                                  ARTICLE VII

      TERMINATION


     Section 7.01   Termination of Agreement

     This Agreement shall be terminated and the Transaction abandoned if at  any
time prior to the Closing:

          (a)  The members of  CHSC at the  CHSC member meeting  called for  the
     purpose of voting on  the Transaction, fail to  approve the Transaction  as
     required by Section  5.01(a), or the  members of Farmland  at the  Farmland
     member meeting called for the purpose of voting on the Transaction, fail to
     approve the Transaction as required by Section 5.01(b); or

          (b)  The  parties  mutually  agree   in  writing  to  terminate   this
     Agreement; or

          (c)  Either party delivers a written notice to the other to the effect
     that (i) one  or more of  the conditions to  its obligations  as set  forth
     herein cannot be  met, (ii)  the other party  has defaulted  in a  material
     respect under one or more of its covenants or agreements contained  herein,
     or (iii) any of the representations or warranties of the other party are or
     have become materially untrue or incorrect  as of the date of such  notice,
     and in any case such condition or conditions have not been satisfied,  such
     default or  defaults  have not  been  remedied or  such  representation  or
     warranty has not  been rendered true  and correct within  thirty (30)  days
     after such notice is mailed; or

          (d)  The Closing has not occurred on  or before December 31, 2000,  or
     such later date as the parties may mutually agree upon.


     Section 7.02   Effect of Termination


     If this Agreement is terminated pursuant to Section 7.01 above, all  rights
and obligations of the parties hereunder  shall terminate without any  liability
of either party to the other (except for any liability of a party for breach  of
this Agreement);  provided,  however, that  the  confidentiality and  return  of

documents provisions  contained  in or  referred  to Section  4.06  above  shall
survive any such termination.

                                  ARTICLE VIII

  MISCELLANEOUS


     Section 8.01   Waiver of Conditions


     Any party  may,  at  its option,  waive  in  writing any  and  all  of  the
conditions herein contained to which its  obligations hereunder are subject.   A
party, by consummating the transactions contemplated herein, shall be deemed  to
have waived any breach of a  warranty, representation, covenant or condition  of
which such party received written notice prior to the Closing Date if the notice
specifically  referred  to  this  Section  8.01  and  described  the  breach  in
reasonable detail.

     Section 8.02   Amendment


     The parties  by  mutual consent  may,  before  or after  approval  of  this
Agreement by the  members, amend, modify  or supplement this  Agreement in  such
manner as may be agreed upon in writing.

     Section 8.03   Binding Nature

     This Agreement shall be binding upon and  inure only to the benefit of  the
parties hereto  and  their  respective successors  and  assigns,  provided  that
neither this Agreement nor any of the rights, interests or obligations hereunder
shall be assigned or delegated  by any of the  parties hereto without the  prior
written consent of the other parties hereto.


     Section 8.04   Counterparts


     This Agreement may be executed in  two or more counterparts, each of  which
shall be deemed an original, but all of which together shall constitute one  and
the same instrument.


     Section 8.05   Entire Agreement


     Except  for  the  Confidentiality  Agreement   (the  terms  of  which   are
incorporated  herein  by  reference  pursuant  to  Section  4.06  hereof),  this
Agreement, the Plan  of Merger and  the other documents  referred to herein  and
therein set forth the entire understanding of the parties hereto with respect to
the matters provided for herein and therein and supersede all prior  agreements,
covenants, arrangements, communications, representations or warranties,  whether
oral or written, by any officer, employee or representative of either party.


     Section 8.06   Notices

     All notices, requests, demands and other communications hereunder shall  be
deemed to have been duly given  if delivered or mailed, certified or  registered
mail, with postage prepaid:
               If to CHSC:

               Cenex Harvest States Cooperatives
               5500 CENEX Drive
               Inver Grove Heights, MN  55077-1733
               Attn: Vice President and General Counsel

               If to Farmland:

               Farmland Industries, Inc.
               Department 62
               3315 North Oak Trafficway
               Kansas City, Missouri   64116
               Attn: General Counsel


     Section 8.07   Non-Survival of Representations and Warranties

     The representations and warranties of the parties contained in Articles  II
and III of  this Agreement  shall form the  basis for  closing conditions  only,
shall not survive the Closing Date and,  except to the extent of the  principles
for the Capital  Plan in  Exhibit D hereto,  shall not  form the  basis for  any
action by  or  on  behalf  of  either party  or  any  third  party  for  breach,
misrepresentation or indemnity at any time after the Closing Date.


     Section 8.08   Captions


     The article and section headings of this Agreement are for convenience only
and shall not affect the meaning or construction of this Agreement.

     IN WITNESS WHEREOF, the parties hereto  have executed this Agreement as  of
the date first set forth above.

CENEX HARVEST STATES                      FARMLAND INDUSTRIES, INC.
COOPERATIVES

By________________________________        By________________________________
Its________________________________       Its________________________________

     The undersigned, UCB Acquisition Co., an Ohio cooperative corporation,  the
only member of which is Cenex  Harvest States Cooperatives, hereby joins in  the
foregoing Transaction  Agreement and  agrees to  take  all actions  required  to
effect Structure B, as therein defined,  if said structure is selected  pursuant
to Section 1.01 of said Transaction Agreement.

UCB ACQUISITION CO.

By                                        Date:   ___________________________
     President
                                  EXHIBIT D


                                  CAPITAL PLAN

I.    Key Principles Underlying the Capital Plan.


     1)   The total capital required by the  Company will be dependent upon  the
          assets required to be owned to  accomplish its mission as well as  the
          cost and availability of debt.

     2)     Each base capital pool will have a target level of base capital.

     3)   Members of the Company will be required to provide capital based  upon
          relative use  of the  capitalization unit  and the  respective  target
          levels of base capital.

     4)   Retention of earnings will be a source of capital.  The percentage  of
          earnings to  be paid  in cash  patronage from  a patronage  pool  will
          increase as a member's capital increases relative to the base  capital
          requirement.

     5)   If a member has capital levels in excess of base capital requirements,
          the excess  amount will  be subject  to retirement  on a  basis to  be
          determined by the Board of Directors.

     6)   Patronage-sourced earnings  will be  allocated  on a  patronage  basis
          provided that the Board will have the authority to designate a portion
          of patronage-sourced  earnings  as  unallocated  surplus  to  build  a
          reserve to absorb losses.

     7)   Earnings from non-patronage sourced business will generally be used to
          build unallocated surplus.

     8)   The concept of Equity Participation Units developed by Harvest  States
          will be retained.

     9)   Minimum capital requirements will be $1,000 for individual members and
          $10,000 for  member  cooperatives, with  all  existing members  to  be
          grandfathered  under  existing  minimum  capital  requirements.    New
          members meet minimum capital requirements through patronage earnings.

II.   Terra Tax Case.


     A.     Key Terra Principles


          1)   No owner equities  will be adversely  impacted in a  consolidated
               setting as compared to stand alone.  In the event, however,  that
               there is an adverse  impact, it is understood  that it should  be
               borne by the former Farmland stockholders (equity holders).
          2)   The Company must maintain a base  of permanent equity to  support
               its operations (i.e.  equity which is  not subject to  retirement
               and is not credited to base capital plan requirements).

          3)   The outcome of the Terra case will not impact voting power.


     B.   Key Terra Agreements


          1)   Each party  will be  responsible  for $100,000,000  of  permanent
               equity.

               a. As set forth in the Plan of Merger, at the Effective Time, the
                    Surviving  Entity  will  allocate  and  distribute  to  CHSC
                    members non-patronage  equity  interests  in  the  Surviving
                    Entity in an  amount equal  to CHSC's  surplus minus  CHSC's
                    deferred patronage  as  of  the  Effective  Time  and  minus
                    $100,000,000. Such non-patronage equity interests shall  not
                    be included for purposes of voting determinations but  shall
                    be "retirement/base capital eligible equity" (i.e., included
                    in determining satisfaction of requirements for base capital
                    and shall  be  eligible  for redemption  under  the  Capital
                    Plan).

               b. At the Effective Time, the  Surviving Entity will allocate  to
                    Farmland  members  non-patronage  equity  interests  in  the
                    Surviving Entity in  an amount equal  to the  excess of  the
                    Farmland surplus over $100,000,000 as of the Effective Time.
                    The non-patronage equity  interests allocated to  Farmland's
                    members shall be distributed to such members by transfer  of
                    such non-patronage equity interests to the Surviving  Entity
                    to be held in escrow on behalf of the Farmland members until
                    the Terra tax case is resolved and is then to be distributed

                    to Farmland members  in accordance with  the provisions  set
                    forth below  or canceled.   So  long as  such  non-patronage
                    equity is  held in  escrow, it  shall  not be  included  for
                    purposes of voting determinations, shall not be included  in
                    determining satisfaction  of requirements  for base  capital
                    and shall not be eligible  for redemption under the  Capital
                    Plan; however,  once  distributed from  escrow  to  Farmland
                    members, such  non-patronage  equity shall  be  included  in
                    determining satisfaction  of requirements  for base  capital
                    and shall be eligible for redemption under the Capital Plan.

          2)   If Terra is lost:


               a. The amount of the Terra loss (which amount shall be net of the

                    deferred tax asset created) shall be determined.

               b. The amount in  2)a. shall  be reduced  by an  amount equal  to
                    64.5% of  the  net  non-patronage income  of  the  Surviving
                    Entity from the Effective Time.
               c. The net  amount  determined  in  2)b.  above  shall  first  be
                    allocated to Farmland  members by cancellation  of the  non-
                    patronage equity issued   under 1)b.  above up  to such  net
                    amount and if, thereafter,  there remains any  non-patronage
                    equity  held  in  escrow  under  1)b.  above,  it  shall  be
                    distributed from escrow to the appropriate members and shall
                    be converted to retirement/base capital eligible equity.

               d. If there is any net loss  remaining after application of  2)c.
                    above (the "Remaining Adjustment"), then equity in an amount
                    equal to  the  Remaining  Adjustment  received  by  Farmland
                    members in the  Merger for their  Farmland Equity  Interests
                    shall  be  converted  to  permanent  equity  so  that   such
                    converted  equity  will  not  be  included  in   determining
                    satisfaction of requirements for  base capital and will  not
                    be eligible for redemption under the Capital Plan.  However,
                    such equity will continue to be counted for voting purposes.

               e. Permanent equity in 2)d. will be converted to  retirement/base
                    capital eligible equity at a rate of 64.5% of the total non-
                    patronage earnings (after application of all expenses  other
                    than  interest  on   borrowings  used  to   pay  the   Terra

                    obligation), less an appropriate interest charge to  reflect
                    the borrowings used  to pay the  Terra obligation, less  the

                    reduction of  the deferred  tax  asset associated  with  the
                    Terra loss.


               f. Debt and  other  funding  actions  required  to  pay  a  Terra

                    judgment will be serviced  from non-patronage income  deemed
                    attributable to Farmland assets.

               g. Equity balances  held  by  estates will  be  retired  in  full
                    regardless of classification.

               h. An example of the foregoing is appended hereto as Appendix I.

          3)   If Terra is won, Farmland members' non-patronage equity allocated

               under 1)b. above will  be converted into retirement/base  capital
               eligible equity and distributed from the escrow.

III.  Other Contingent Liabilities.


     A.   Key Principles  The parties recognize that there will be  liabilities

          that arise in the  future out of facts  that existed at the  Effective
          Time, which liabilities would be required to be paid by the  Surviving
          Entity.  Some of such liabilities and/or the facts related thereto may
          not  be  disclosed  pursuant  to  the  Transaction  Agreement,  or  if
          disclosed, nevertheless  may not  be adequately  reserved for  in  the
          party's financial statements.
     B.   Reclassification.   Accordingly, in  addition to  the Terra  Tax  case

          matter, the Surviving Entity shall make reclassifications of equity as
          follows:    (a)  with  respect  to  Farmland  Contingent  Losses,  the
          Surviving Entity shall reclassify the equity that was received in  the
          Transaction in exchange  for Farmland common  stock or other  Farmland
          equity, and (b) with respect to CHSC Contingent Losses, the  Surviving
          Entity shall reclassify the equity that  was retained with respect  to
          CHSC equity  or  was received  in  exchange  for CHSC  equity  in  the
          Transaction.

     C.     Procedures and Definitions.


          1)   As used herein, "Farmland Contingent Loss" is a loss that exceeds
               $1,000,000.00 incurred by the Surviving  Entity arising out of  a
               matter or  group  of  related  matters  relating  to  liabilities
               (fixed,  contingent  or  otherwise,  but  not  including   losses
               relating to the Terra Tax case)  of Farmland, the material  facts
               of which existed at the Effective  Time but were not included  in
               Farmland's Disclosure Schedule and  were not adequately  reserved
               for in the financial statements of  Farmland as of the  Effective
               Time, or even if included in  such disclosure schedule, were  not
               adequately reserved for in  the financial statements of  Farmland
               as of the Effective Time, and a "CHSC Contingent Loss" is a  loss
               that exceeds  $1,000,000.00  incurred  by  the  Surviving  Entity
               arising out of a matter or  group of related matters relating  to
               liabilities  (fixed,  contingent  or  otherwise)  of  CHSC,   the
               material facts of which  existed at the  Effective Time but  were
               not  included  in  CHSC's   Disclosure  Schedule  and  were   not
               adequately reserved for in the financial statements of CHSC as of
               the Effective  Time,  or  even if  included  in  such  disclosure
               schedule, were  not  adequately  reserved for  in  the  financial
               statements of CHSC as of the Effective Time; and which in  either
               case come to light before October 1, 2000 or such earlier time as
               the parties agree.  For purposes of these definitions: (i) a loss
               shall be deemed to have been incurred at the earlier of the  time
               that (a) it was  actually incurred, or (b)  at the time that  the
               party incurring the loss is required  by GAAP to account for  the
               loss on its  books; (ii)   whether a  liability was  "adequately"
               reserved for shall  be assessed  with reference  to the  finally-
               determined amount of  the liability  in question;  and (iii)  the
               amount of a Contingent Loss shall be determined net of any actual
               reserves.

          2)   In determining the amount of any loss, there shall be taken  into
               account the reserves for such loss that were provided for in  the
               financial statements  of (i)  Farmland or  of any  unconsolidated
               Subsidiary of Farmland, in the instance of determining the amount
               of any  Farmland  Contingent  Loss,  and  (ii)  CHSC  or  of  any
               unconsolidated Subsidiary of CHSC, in the instance of determining
               the amount of any  CHSC Contingent Loss.   Determinations of  the
               amount of any loss shall be made by the board of directors of the
               Surviving Entity.

          3)   Such reclassification of  equity shall be  done by the  Surviving
               Entity as follows:
               a. Each party's Contingent Losses shall be calculated.

               b. $20 million shall be deducted  from each such Contingent  Loss
                    figure, to arrive at a "Net Contingent Loss" figure for each
                    party.

               c. Reclassification of equity  shall be  made with  respect to  a
                    party only if, and to the extent that, the aggregate of such
                    party's Net Contingent Losses  exceeds the aggregate of  the
                    other party's Net Contingent Losses.

          4)   Any such reclassification shall be made in a manner substantially
               similar to the procedures for the reclassification to be made  if
               there is a loss relating to the  Terra Tax case (as set forth  in

               II above).

          5)   The provisions  of  this  Part  III  may  be  modified  upon  the
               affirmative vote of three-fourths of the full board of  directors
               of the Surviving Entity.
                                   Appendix I


1.   Assume a  Terra  loss  with  a  required payment  of  $400  million.    The
     approximate after-tax charge to equity would  be $280 million.  A  deferred
     tax asset of $120 million would be created.

2.   If Farmland allocated  equity is $550  million and  unallocated surplus  is
     $250 million, the $280 million charge  would offset the entire  unallocated
     account; $30 million would be carried in a deficit account.

3.   Of the $550 million in allocated equities, $130 million would be  converted
     to  permanent  equity.    The  remaining  $420  million  would  remain   as
     retirement/base capital eligible equity.

4.   Assume, after  the Effective  Time, the  Surviving  Entity has  total  non-
     patronage income (after application of all expenses other than interest  on
     borrowings used to pay the Terra obligation) of $93 million.

5.   Of the  $93  million in  total  non-patronage earnings,  approximately  $60
     million would go into the Farmland pool.

6.   Assume the interest expense on the Terra note is $25 million.  The net non-
     patronage sourced income in the Farmland pool would be $35 million.

7.   The $35  million net  non-patronage  sourced income  in  the pool  will  be
     sheltered with the NOL.  As the NOL is used, the deferred tax asset will be
     reduced.

8.   The net build-up in  the unallocated surplus  attributable to the  Farmland
     pool will be  $35 million  less the reduction  in the  deferred tax  asset.
     This net  number  will be  the  amount  of permanent  equity  converted  to
     retirement/base capital eligible equity.